Whiting, Titan International lose after earnings; Rayonier Advanced Materials notes improve

By James McCandless

San Antonio, Aug. 1 – The distressed space saw a negative day fueled by earnings reports and news on the trade front.

Whiting Petroleum Corp.’s notes lost during the day after the company released its second-quarter earnings and announced layoffs.

Sector peer Weatherford International plc’s issues moved in opposite directions as the company won access to $1.75 billion in financing.

As news of more tariffs broke, oil futures declined along with California Resources Corp. and Range Resources Corp.

Meanwhile, farm machinery name Titan International, Inc.’s notes slid after the company reported an earnings loss.

In chemicals, Rayonier Advanced Materials Inc.’s issues gained after the company announced a $175 million asset sale.

Steel name United States Steel Corp.’s paper trended negative after news of new tariffs broke.

Telecom name Frontier Communications Corp.’s and Intelsat SA’s notes trended negative.

Whiting loses

Whiting Petroleum’s notes were seen losing during the day, traders said.

The 6 5/8% senior notes due 2026 fell 1½ points to close at 86½ bid.

The notes saw $88 million on the tape by the end of the session.

After the close on Wednesday, the Denver-based independent oil and gas producer released a worse-than-expected second-quarter earnings report.

The report was highlighted by a 28 cents per share loss where analysts expected a 25 cents per share profit.

Revenues were also underperforming at $426.26 million.

The company also announced that it would be cutting 254 jobs, or 33% of its workforce.

“The equity side was more reactionary,” a trader said. “The bonds are relatively well-rated, and the company is not missing production targets by much. Creditors are starting to push these energy names on overstaffing, and this is an example of that.”

The layoffs are expected to save the name $50 million.

Weatherford down

Sector peer Weatherford’s issues took opposite tracks, market sources said.

The 4½% senior notes due 2022 dropped 3 points to close at 41½ bid. The 8¼% notes due 2023 gained 3¾ points to close at 45½ bid.

After the Baar, Switzerland-based oilfield services provider settled with shareholders who were trying to form an official bargaining committee, the company won final approval to access $1.75 billion in financing, Prospect News reported.

A group of shareholders had been trying to form the committee to argue their interests in bankruptcy court.

Instead, the company agreed to improve stock warrants and recoup the group’s professional fees.

In late June, the company filed for Chapter 11 bankruptcy.

Oil declines

As oil futures dipped in response to trade news, energy names followed, traders said.

Los Angeles-based producer California Resources’ paper declined.

The 8% senior paper due 2022 slid 4¼ points to close at 65¾ bid. The 6% paper due 2024 declined 1½ points to close at 53 bid.

After the Thursday close, the company reported a 29 cents per share loss, surprising analysts who pegged it at a 59 cents per share profit.

Fort Worth-based peer Range Resources’ notes were also negative.

The 5% senior subordinated notes due 2022 shaved off ¾ point to close at 89½ bid. The 4 7/8% senior notes due 2025 fell 1½ points to close at 82½ bid.

After President Trump announced a new round of tariffs on Chinese imports, oil futures treaded water.

West Texas Intermediate crude oil futures for September delivery lost $4.63 to settle at $53.95 per barrel.

Titan slides

Meanwhile, Titan’s issues were seen sliding, market sources said.

The 6½% senior secured notes due 2023 dropped 4¼ points to close at 85¾ bid.

The Quincy, Ill.-based agricultural machinery maker released its second-quarter earnings Thursday morning.

The company showed a 12 cents per share loss, slightly better than the 15 cents per share loss that analysts had predicted.

It also showed lackluster revenues at $390.6 million.

The name’s structure moved into distressed territory at the end of May after releasing its first-quarter earnings, blaming its underperformance on decreased demand tied to lower commodities prices and an uncertain trade climate.

Rayonier up

Elsewhere, Rayonier’s paper spent the day gaining, traders said.

The 5½% senior paper due 2024 picked up 2¾ points to close at 82½ bid.

On Thursday morning, the Jacksonville, Fla.-based chemicals producer announced that it had reached an agreement to sell its Matane, Quebec, pulp mill to Sappi Ltd. for $175 million.

The company’s structure came under pressure in May after releasing disappointing first-quarter earnings after experiencing unfavorable prices on commodities and the current constraints of the trade climate.

Following the news, the company’s structure fell from the mid 90s context to the low 80s.

U.S. Steel negative

Manufacturer U.S. Steel’s notes were trending negative, market sources said.

The 6¼% senior notes due 2026 dropped ¾ point to close at 90¼ bid. The 6.65% notes due 2037, while pushing to 84 bid during the day, closed level at 85½ bid.

The Pittsburgh-based steelmaker saw another round of negative attention after President Trump announced that the government would impose another round of tariffs on $300 billion worth of Chinese imports.

The company’s notes have been volatile as trade policy remains uncertain.

Frontier, Intelsat dip

In the telecom space, Frontier’s issues dipped, traders said.

The 7 1/8% senior notes due 2023 lost 1½ points to close at 57¾ bid. The 11% notes due 2025 fell 1¾ points to close at 56¼ bid.

The Norwalk, Conn.-based wireline communications company has been under the market’s microscope as it works on how to handle a maturity wall coming soon, weighing versions of a distressed exchange.

Luxembourg-based satellite operator Intelsat’s paper finished with a negative bent.

Intelsat Jackson Holdings SA’s 5½% senior paper due 2023 gave back 1 point to close at 91½ bid. Intelsat (Luxembourg) SA’s 8 1/8% paper due 2023 held level at 81 bid.

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